By BILL HENSEL JR. AND BRETT CLANTON, HOUSTON CHRONICLE

Updated 10:00 pm, Tuesday, February 26, 2008

Delta Air Lines has not arrived at a merger deal that "meets all of our principles" and is prepared to remain a stand-alone carrier if it can't reach its goals, Chief Executive Officer Richard Anderson said Tuesday in an open memo.

The message -- the company's most detailed update in months on its merger talks -- comes as Delta and Northwest Airlines are discussing a potential combination to create the world's largest carrier.

The letter was seen by some analysts as a response to speculation that a merger may be unraveling.

Delta made clear publicly for the first time Tuesday that it has several conditions that must be met before it agrees to a deal.

Any transaction must keep the Delta name and the company's headquarters in Atlanta, protect seniority rights of its employees, maintain pension plans for employees and retirees, strengthen its network and accelerate plans for international expansion and provide greater job security along with more career opportunities for its people, the memo said.

"We will not complete a transaction unless all of these conditions are met," Anderson said in the memo, which also was signed by President Ed Bastian.

Pilots unions at the two airlines have struggled for days to mix seniority lists. While the airlines don't need an agreement to move forward, they have sought one to smooth passage of a merger with regulators and employees.

"This is kind of a two-by-four across the head of the Northwest merger committee to either get in line or be the one that killed the deal," said Robert Mann, an industry consultant with R.W. Mann & Co.

Northwest CEO Doug Steenland, in a separate memo to employees late Tuesday, said without mentioning Delta by name that he continues to believe "consolidation among the network carriers is inevitable."